The GOP-controlled Joint Finance Committee today added a package to the budget that would produce a net reduction in taxes of $378.6 million, including an income tax reduction that would average $75 per person.
Separately, the committee was expected to vote Thursday on a standalone bill that would add another $136.1 million in income tax cuts and redistribute $61 million in reductions already in current law.
Dems said the tax cut package added to the budget fell short of what Gov. Tony Evers proposed after campaigning on plan targeting the middle class last fall.
JFC Co-Chair John Nygren, R-Marinette, said the guv had the chance to see his tax cut become law when Republicans approved a version of it.
But he vetoed the bill because Republicans wanted to use money from a surplus to cover the cost in this biennium, while Evers had campaigned on raising taxes on manufacturers to pay for his version.
“The choice is very clear on this opportunity today: Passing tax relief onto those who need it the most or take a political stand and break another political promise,” Nygren said.
According to the Legislative Fiscal Bureau, the tax plan added to the budget would result in a tax cut for 62 percent of filers who would see a tax cut averaging $75. It would reduce the tax rate for income in the second lowest bracket to 5.21 percent from the current 5.84 percent.
In tax year 2019, those making $150,000 or below would receive 85.9 percent of the reduction, which would range from $3 for those making less than $5,000 to $95 for those with incomes between $125,000 and $150,000. Those with incomes above that would see an average reduction of $91 to $95.
Dems slammed the GOP record on taxes over the last eight years, saying their Republican colleagues had focused their attention previously on the wealthy at the expense of lower- and middle-class residents.
That included again hammering a GOP tax credit for manufacturers and farmers. The guv’s budget proposed capping the manufacturing component of that credit at the frist $300,000, which would’ve resulted in a $517 million tax increase. But Republicans rejected the proposal.
Rep. Chris Taylor, D-Madison, said Evers’ tax cut plan would’ve been twice as large while those making more than $150,000 wouldn’t have seen a dime of the reduction. Meanwhile, she said Republicans were rejecting the guv’s proposal to create a $9.9 million tax credit a year for childcare costs and a $4.1 million proposal to help first-time home buyers.
“The difference is he doesn’t give it to the people who don’t need it, and you do,” Taylor said.
The GOP motion also includes:
*putting an additional $58.6 million in general purpose revenue into the funding for the lottery tax credit to reduce property taxes.
*signing off on the guv’s proposal to modifying limitations on a deduction for medical care insurance purchased by the self-employed, reducing taxes an estimated $9.5 million in the second year of the budget.
*approving the guv’s recommendation to increase funding by $8 million for a refundable property tax credit for veterans and surviving spouses.
*transferring $30 million in surplus funds from the Wisconsin Economic Development Corp. to the general fund.
*increasing the tax on vaping products by $5.5 million. The guv had proposed a $36.4 million increase in taxes on vaping products.
See the LFB distribution memo on the individual income tax cut added to the budget.
See the GOP tax motion.